What is Net and Gross Metering

As we know that, it is expensive to store electricity, systems are often connected to the grid so that surplus can be exported to the grid and deficit can be imported from the grid. Two arrangements are often defined by governments when designing the regulations for solar rooftop system – Gross and Net metering.

What is gross metering?

Under the solar Gross Meters scheme, which was very popular during the government sponsored high feed in tariff rates, the solar power generation was connected straight to the grid and not to your house. The entire output of your system was sent back to the grid (Accounted by a unidirectional ‘gross meter’ on a pre-determined feed-in tariff and you has to pay electricity consumed from the grid. This scheme has been discontinued in most of the states due to low tariff rates.

What is Net Metering ?

Net meters work by continuously sampling how much electricity is being generated and how much electricity is consumed at your home. At each point in time the meter instantaneously reads the generation and consumption of the premises and the meter records both these amounts. Net metering is an arrangement in which electricity exports are adjusted against imports, lowering the electricity bill, such that, electricity produced is deducted from the total electricity consumed over a fixed period of time. The adjustment may be done either on a monthly, half-yearly or annual basis. Typically, a bidirectional ‘net meter’ accounts for both import and export of power. If the exported electricity is higher than the imported electricity, a consumer may or may not be compensated for the excess electricity being fed into the grid (depending up a state’s net metering policy.


With increasing awareness and availability of new business models, more and more consumers are adopting rooftop solar systems. In the current context while many distribution companies are inclined to discourage rooftop installations due to potential revenue loss, few have proposed to shift from net metering to gross metering. This is because under the gross metering arrangement, compensation to consumers is typically lower than the retail supply tariff (at which they buy electricity from discoms). While, under net metering since import of power is adjusted against the export, the compensation is effectively at retail supply tariff. Therefore, as a revenue protection measure, they are inclined to adopt gross metering instead of net metering[1]. However, there may be exceptions and consumers should understand the benefit and impact before choosing net or gross metering for their solar rooftop system (if discom provides the option).

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